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99.9% of debt in the world will be defaulted on. Only 0.1% is paid back.
Comments
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Malthusian wrote: »
Global debt is nil and always will be. Who does the globe owe this debt to? The Martians? Every debt on earth is an asset to somebody else who is also on Earth, which means that globally, all debt nets off..
This is a very interesting quote that sums up just how uneducated so many people still are.
Try your argument on China and try to explain that all the trillions that are owed to China by USA and other countries are all off.
All debts are off:rotfl::rotfl: even though I agree with you it’s not for the reasons you think.
Not All debts but 99.9% of debt in the world are off because they are impossible to pay back.Nothing has been fixed since 2008, it was just pushed into the future0 -
Anyway that bloke in you illustration did pay his debt off
Says who? It's my scenario and I didn't say anything about whether he'd paid it off. He's in his 40s and he owes £400,000, a debt which has ballooned from £30,000 to £200,000 to £400,000. Unsustainable debt spiral!
And all of the billions of people and institutions that pay their debts on time are also part of the 0.1%. Got it.so he is part of the 0.1% of debt that doesn’t get defaulted.
I don't think you understand what "nets off" means.Try your argument on China and try to explain that all the trillions that are owed to China by USA and other countries are all off.
The trillions owed by the USA to China are a trillion-dollar asset owned by the Chinese. Net global debt in respect of these debts = trillion-dollar liability owed by the USA minus trillion-dollar asset owned by the Chinese = nil. This applies to every debt on the globe which means global debt = nil.
This will remain the case for as long as humanity doesn't establish interstellar colonies or meet intelligent life and borrow money from them. I'm not even sure whether interstellar debt would be feasible, given that if there was a global debt of 1 quadrillion quatloos owed by Earth to Alpha Centauri, it would take at least three years for Alpha Centauri to get its money back after Earth sent the payment, as the information that Earth has or hasn't repaid can't get to Alpha Centauri faster than the speed of light. (Unless there's some hyperspace / quantum thingy we don't yet know about.) It would make a pretty good basis for an Alistair Reynolds novel.
Global gross debt is an irrelevant statistic of no importance, like my imaginary successful salaryman's £400,000 gross debt.0 -
Malthusian wrote: »Says who? It's my scenario and I didn't say anything about whether he'd paid it off. He's in his 40s and he owes £400,000, a debt which has ballooned from £30,000 to £200,000 to £400,000. Unsustainable debt spiral!
He's not in an unsustainable debt spiral, he has a saleable asset that will pay off the debt. How you use the money you borrow is more important than the value.Malthusian wrote: »The trillions owed by the USA to China are a trillion-dollar asset owned by the Chinese. Net global debt in respect of these debts = trillion-dollar liability owed by the USA minus trillion-dollar asset owned by the Chinese = nil. This applies to every debt on the globe which means global debt = nil.
I think Greece would be interested in your theory.0 -
He's not in an unsustainable debt spiral, he has a saleable asset that will pay off the debt.
As does the globe.
We're not talking about Greek debt, we're talking about global debt. Start your own thread if you want to talk about Greek debt.I think Greece would be interested in your theory.0 -
A debt can only be paid off fully by the asset if the asset has a value of at least the debt amount in nominal terms. This is by no means a guarantee and it is why we have credit crises (large and small).
The person who said all assets equal the total amount of debt is not correct. Not only can asset values fluctuate, secured debts do not have recourse to all assets so the comment on total debt being equal to total assets is nonsense.
Debt is a tool and is very much necessary for economic growth. It enables capital to allocated. Hopefully efficiently. Debt can sometimes go bad hence why debt is written off sometimes as the asset that was purchased using this debt does not have sufficient value to recover the debt.0 -
Which assets are you talking about that is owned by the Chinese? Sure the Chinese owns a bunch of US treasury bonds. But these bonds are unsecured - they are no assets that the Chinese have recourse to to in the case the US go bust.0
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Global debt is approaching $300 trillion growing about 10% compounded. It's growing by another $30 trillion in 2018 alone, and estimations are another $50 trillion or so in 2019, probably a lot more with growing interest rates.
The issue is, is it even possible to pay off?
The answer is obviously no. 99.9% is not possible to pay off, only 0.1% will not be defaulted on.
All that can be done is keep expanding the debt.Nothing has been fixed since 2008, it was just pushed into the future0 -
Huge amounts of borrowing is secured by underlying assets such as future resource extraction, real estate, tangible property, future cash flows, etc. Also many borrowers hold huge cash and asset reserves alongside massive debts - e.g. Apple has $100bn debt, but has $300bn cash. Microsoft has close to $100bn of debt and $135bn of cash. All in all, a lot more than $300bn of debt will be repaid.0
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Huge amounts of borrowing is secured by underlying assets such as future resource extraction, real estate, tangible property, future cash flows, etc. Also many borrowers hold huge cash and asset reserves alongside massive debts - e.g. Apple has $100bn debt, but has $300bn cash. Microsoft has close to $100bn of debt and $135bn of cash. All in all, a lot more than $300bn of debt will be repaid.
Apple Microsoft stil only pet of the 0.1% of global debt.
Yes this is debt that will not be defaulted on.
It's the 99.9% of debt in the world that can not be paid back...Nothing has been fixed since 2008, it was just pushed into the future0 -
Apple Microsoft stil only pet of the 0.1% of global debt.
Yes this is debt that will not be defaulted on.
It's the 99.9% of debt in the world that can not be paid back...
What about the debt that you have, which you are trying to avoid paying back:The default date was 2010 and I have ignored everyone since then.
So I have not accepted it as a debt ince then.
I understood that if you ignor for 6 years then it goes away. It if you ever rep,y to them or accept the debt again in any way the six years clock starts from zero again.
Anyway shall I write to CRAs to remove it because it’s over 6 years without any contact at all?Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop0
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